March is obviously a busy month for franchised car dealers, and perhaps carries more significance this year given that it coincides with the end of scrappage. There are mixed feelings about what the impact will be when the scrappage scheme finally draws to a close, but if other parts of Europe are anything to go by we are in for tough times.
The biggest winners from the scrappage scheme Hyundai, Kia, Ford etc have perhaps the most to worry about. Despite the fact that cars sold in the scheme were models with the lowest profit margins, indicating that though there may be a significant drop in volumes there are still opportunities to offer value in other areas in order to remain profitable whilst selling higher end models.
Already many car makers are gearing up to try and keep some momentum given by the scheme by offering their own incentives to attract more customers. As one sales manager told us however ‘we survived before scrappage and we will survive without it’.
I think that scrappage was exactly the shot in the arm the business needed and should be acknowledged as that, it’s now back to hard work, building value in the service and products offered to buyers and ensuring that offers are attractive enough and communicated clearly enough, to make up for the shortfalls in numbers.
The other aspect, of course, is that sales people who have enjoyed the easy life of pre-agreed discounts have to return to actually being sales people again and working hard for a deal keeping them sharp and hungry but most of all laser focussed on customer service.
Let’s hope they’re up to the job.